Garden Gnome Fans Fret; SkyMall Files For Bankruptcy
NEW YORK (AP) — Apparently, airline passengers aren’t buying enough garden gnomes, superhero pajamas and heated cat shelters. SkyMall has filed for bankruptcy.
The quirky in-flight shopping catalog has been a mainstay on airlines since 1989. Passengers with nowhere to go would pull it from the seatback and flip through the pages. While flying high over Iowa, they could dream about owning a $16,000 multisensory home sauna or maybe just a grill spatula with a built-in flashlight for $29.95.
But in recent years, passengers have found other distractions. More planes have seatback TV screens. The federal government now allows us to keep Kindles and iPads on during the entire flight. And most jets in the U.S. now have Wi-Fi meaning passengers can chat with friends back home or actually do work.
“Nobody’s bored anymore. They don’t have a captive audience,” says John DiScala, who runs the travel advice site JohnnyJet.com “Not only is it full of germs but travelers today have all the information they need at their fingertips.”
So Thursday, SkyMall’s parent company, Phoenix, Arizona-based Xhibit Corp., filed for Chapter 11 protection in U.S. bankruptcy court. In the filing, the company said it has $1 million to $10 million in assets but $10 million to $50 million in liabilities.
Its biggest creditors are airlines. The company owes American Airlines $1.6 million, Delta Air Lines $1.5 million, Southwest Airlines $400,000 and United Airlines $300,000. It also has debts with UPS, specialty retailer Hammacher Schlemmer and American Express.
“Given how much of joke SkyMall was among travelers, I’m not surprised,” says Matt Kepnes, author of “How to Travel the World on $50 a Day” and other travel books. “I’m don’t know anybody who has ever purchased anything from them.”
In a statement Friday, SkyMall’s acting chief executive officer, Scott Wiley, said that on Jan. 9 the company hired bankers to pursue a possible sale. A week later, SkyMall suspended its catalog business and laid off 47 workers, most of them call center employees.
SkyMall hopes to complete a sale by April. But Wiley also said creditors are prepared to shut down the company if necessary.
If it survives, SkyMall must find a way to stay relevant to passengers who are no longer a captive audience. It will also need to convince airlines to keep filling their planes with the magazine. Fewer airline seats now have seatback pockets to hold a magazine. And airlines are much more aware of the added fuel cost for carrying the heavy publication — a recent holiday version had 170 pages.
Delta stopped carrying the magazine in November.
Over the years, SkyMall has taken on a cult-like following. Travel news website Gadling, for instance, used to have a SkyMall Monday feature, highlighting some of the more unusual items for sale.
If the magazine were to shut down, there’s nothing else to fill that niche. The beauty of SkyMall — after all — is that it highlights items passenger never thought they needed. Where else can you order a remote controlled tarantula while flying at 35,000 feet?
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